I'm not 100% sure what "freeform" means in this thread; and I've never played Fate.
I does seem to have a hazy meaning lately. For my part, the meaning was mechanics, rather than play behavior. (Particularly Freeform descriptors used in those mechanics.) That doesn't seem to be the case for some.
To the point wrt Fate. I think
@Umbran mentioned this above somewhere. In Fate, a player can perform a type of action called Create an Advantage. In contrast to D&D, this creates an that can then be drawn upon later for mechanical advantage in a relatively predictable way. In the fiction, this just means that the character has done something to change the fiction. So, I might spend a turn to get the badguy "In my sights" or get myself "hidden in a barrel". This gives the players a way to relatively reliably change the fiction, thus they can count on those oddball actions to "work". If I throw "sand in his eyes", I don't need to invoke any other mechanics. With D&D...you can try to maneuver or something, but if the rules don't cover it...maybe its worthless. (I recall another person on a Fate or Fudge board saying: "This is the first system I've played that makes 'I dump a bag of marbles on the floor" easy to adjudicate.)
The "lightest" system I've ever played is
Cthulhu Dark. PC gen is
choose a name and an occupation for your PC and then give a description. "Occupation" here doesn't mean
character class but means
job. We've had a stevedore, a couple of investigative reporters, a legal secretary, and a butler.
Resolution involves rolling a pool of d6s (1 to 3, depending on whether the attempted action is humanly possible, is one that your job helps with, and/or you are risking your sanity to succeed). The basic rule is "your highest die shows how well you do. On a 1, you barely succeed. On a 6, you do brilliantly." There is also a rule for introducing the possibility of failure in virtue of an opposed check.
A very simple, light system.
There are no aspects and no clocks (there is an escalating sanity die, but it's not a clock in the resolution context, only in the scenario failure context), but I find it works pretty well. As a GM I apply some fairly simple principles from other systems: intent and task action declaration; no retries. The fiction unfolds pretty quickly and fairly unpredictably. The main function of success and failure is to change the fiction, not to introduce mechanical burdens or constraints on subsequent checks.
Yup. Although somebody has to be determining that 1-3 range based on whether or not something applies or is humanly possible. Not really different from setting a DC, wrt a bad/ignorant/atagonistic GM, I wouldn't think. Although the rules may also posit different i.e. non-traditional positions for the GM to take when adjudicating such things. For example, how worried about "realism" will you be? Additionally, IME, relatively simple systems like this work very well when the PCs are not expected to have a variety of powers, etc. Deciding what is "humanly possible" is a very arbitrary business when one guy can wave his fingers and launch magic missiles while the other guy gets as tough as chain mail when he is angry.
I would call the rules you describe "freeform" for my purposes. Which is to say that none (or very few) of the fictional parameters are hard-coded (or even medium-coded?) into the system. It's very light, in that it doesn't code them at the table mechanically, but it also doesn't really leave room for that to matter in its resolution mechanic either.
Compared to this system, I wouldn't see 5e as being very freeform. Nor 4e, but the latter does have some of the rationing devices you point to ("clocks", in the form of skill challenges; resources to spend in the context of resolution like encounter or daily powers and action points and healing surges) which mean that actions can be framed and then resolved purely procedurally without having to make calls about what the difficulty should be, whether the outcome is balanced with a spell or magic item, etc. I assume it's these sorts of features which
@Garthanos has in mind in saying that 4e is better than 5e for freeform.
I'm not familiar enough with whatever ended up being the final form of skill challenges, but the ones I'm familiar with had non-procedural DCs involved. Did that change? As I understand it, some of the objection to 5e's way of handling things was that the DM could always set (sometimes unknowingly) a "bad" DC for an action (or require too many checks, etc.) I'm not sure how 4e supposedly alleviated this (eventually?).
IMO, the biggest thing that the skill challenge mechanics bring to 4e is a clarity of purpose and progress. That is, "We want to do X!" The GM can then set up a challenge, which puts that "on the table". Then, at least, when a character succeeds at a relevant skill check, they know that they have made a point of progress to completing the goal. At the very least, this prevents a DM from pulling the rug out from underneath you without mechanical justification, and forces them to put their cards on the table upfront. If the GM declares that it will take 4 successes, they can't later backslide and demand 7.
Nonetheless, I think you're correct in general. Although, compared to something like Fate....no D&D is terribly flexible.
I don't really know of any D&D-friendly solution to the "setting difficulties" problem. "AC" is a pretty primordial element of D&D, and its just a specific-case of "DC". So long as someone is setting DCs/ACs they can make all sorts of bad judgements that can affect play. The only thing I can say is that it seems like a "bad GM" problem (social contract, DM attitudes, expectations, etc.). A static skill/difficulty system can work just fine, especially for light play, but people seem to really want scales of ability and difficulty.